Judge Won’t Budge on His Order in Waymo v. Uber Trade Secrets Case

SAN FRANCISCO (CN) — A federal judge Wednesday was unmoved by accusations that he’d forced Uber to fire its star engineer Anthony Levandowski for refusing to deliver evidence that could prove Levandowski and Uber stole trade secrets from its driverless car rival Waymo.

The accusation came from Levandowski’s attorneys at a hearing on his motion to intervene in Waymo’s lawsuit, accusing him and Uber of stealing its technology to build a competing self-driving car.

Levandowski sought to intervene to request modifications to a May 15 provisional relief order from U.S. District Judge William Alsup, to clarify that Alsup had not ordered Uber to fire him if he refused to waive his Fifth Amendment rights and produce key evidence in the case.

Alsup ruled from the bench that Levandowski’s May 18 motion is moot, based on assurances from Uber attorney Karen Dunn that Uber fired Levandowski on its own initiative, not based on Alsup’s order.

Uber told Levandowski in a May 26 letter that it had fired him from his job leading Uber’s driverless car program for not cooperating with its internal investigation into Waymo’s allegations, and announced the firing publicly on May 30.

“I issued a very fine-tuned preliminary injunction order and I’m not going to take back one word on that,” Alsup said Wednesday.

Fearing criminal prosecution, Levandowski invoked his Fifth Amendment rights against self-incrimination to avoid producing documents or answering questions about them at his deposition, a motion Alsup denied.

In his provisional relief order, Alsup directed Uber to make Levandowski return thousands of files he stole from Waymo before resigning to work for Uber, writing that Levandowki had likely concealed “troves” of self-incriminating evidence by invoking his Fifth Amendment rights. Earlier this week, U.S. Magistrate Judge Jacqueline Scott Corley ruled that a due diligence report purportedly related to the stolen files – which both Levandowski and Uber have fought to keep private under attorney-client and work product privilege – must be produced.

Waymo, a Google spinoff, says Levandowski downloaded 14,000 confidential files from its server just before he resigned in January 2016 to form a competing driverless car company called Otto, which Uber quickly acquired. The files include information on Waymo’s secret LiDAR system, a laser-based scanning and mapping technology its driverless cars use to “see” their surroundings.

Waymo sued Uber and Otto in February, claiming Levandowski used its technology to set up Otto, and that Uber snapped up Otto to get its hands on Waymo’s technology to fast-track its floundering driverless car program. It did not name Levandowski as a defendant.

On Wednesday, Levandowski’s attorney Miles Ehrlich told Alsup that his provisional relief order had forced Levandowski to choose between his job at Uber and waiving his Fifth Amendment rights, because it required Uber and Otto to “exercise the full extent of their corporate, employment, contractual, and other authority” to force Levandowski to produce the stolen files and tell Uber what he did with them after leaving Waymo.

Levandowski said in his motion that the judge’s order meant that Uber would be held in contempt had Levandowski refused to waive his Fifth Amendment rights and Uber not fired him, “since it would fail to measure up to the court’s command that Uber exercise every lawful power it has over Mr. Levandowski.”

Ehrlich said Wednesday that Alsup’s order is an unconstitutional state action that requires correction. He said the state cannot force people to self-incriminate on pain of losing their jobs, but Alsup had forced Levandowski to do so by coercing, or at least “providing significant encouragement” to Uber to fire him if he did not cooperate.

“We are required to addresses the injury that is still ongoing,” Ehrlich told Alsup. “The injury is not being fired; the injury is being forced by state action to this unconstitutional choice. All of us … understood you to be saying that Uber fire every bullet it had against Mr. Levandowski to waive his Fifth Amendment right.”

Ehrlich said that Uber had kept Levandowski on as an employee throughout the litigation, had not demanded that he waive his Fifth Amendment rights, and had not threatened to fire him if he refused to do so, until Alsup delivered his order. And that according to Alsup himself, the first of two letters Uber sent to Levandowski about his job status after Alsup issued the order “blamed the judge, meaning me, and said ‘the judge is making us do this, we’re going to fire you unless you cooperate with this investigation.’”

Responding to Alsup’s concern about whether Uber fired Levandowski on its own initiative, Uber attorney Dunn told the judge that Uber fired Levandowski because he had ignored an internal deadline Uber set for him to turn over evidence.

“It is very hard to look at this entire situation and pretend the court order doesn’t exist,” Dunn said. “The court’s order certainly provided substantial additional heft to what we had been urging, and the letters made clear that this has to do with our urging, in addition to the court’s order.”

Turning to Levandowski’s state action argument, Alsup said that though a government employer cannot use the Fifth Amendment to threaten to fire employees who do not cooperate with an investigation, a private employer, like Uber, can.

“Sometimes on a preliminary injunction you can order remedial relief that is something that the other side may not be strictly entitled to but is necessary in order to remedy the wrong that has been done. There is broad equitable power to carry out what is the right thing to do,” Alsup said. “So a federal district court surely has the authority, as part of remedial provisional relief, to order a private company to do something that it would have the authority to do on its own.

“The Fifth Amendment is not a bar to the relief granted, and I’m not taking back a single word of it, and it’s not going to be modified in any way.”

Also Wednesday, Alsup heard Uber’s motions seeking to stay the case while it appeals to the Federal Circuit his denial of its motion to force arbitration, and to dismiss Waymo’s state Unfair Competition Law claim.

Ruling from the bench, Alsup denied the motion to stay, saying a stay would harm Waymo.

But he indicated he would grant Uber’s motion to dismiss Waymo’s unfair competition claim based on Silvaco Data Systems v. Intel Corp. In that case, California trial and appeals courts found that using infringing software is not trade secret infringement.

Uber says Waymo’s unfair competition claim (UCL) and its California Uniform Trade Secrets Act (CUTSA) claim are based on the same allegations, and that the UCL claim is pre-empted by CUTSA.

“I want you to know I’m stuck with the Silvaco case,” Alsup told Waymo attorney James Judah, though the judge said he believes Silvaco was wrongly decided. “I’m sympathetic to your position, but you’re going to lose your motion.

“I feel like you’ve got to go to the Legislature and get them to fix this, but I can’t fix it for you.”

Ehrlich is with Ramsey & Ehrlich in Berkeley; Dunn with Boies Schiller Flexner in Washington, D.C.; and Judah with Quinn Emanuel Urquhart & Sullivan in San Francisco.